Lippo Malls Indonesia Retail Trust. Annual General Meeting 18 April 2018

Transcription

1 Lippo Malls Indonesia Retail Trust Annual General Meeting 18 April 2018

2 Disclaimer Certain statements in this presentation concerning our future growth prospects are forward-looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. These forward-looking statements reflect our current views with respect to future events and financial performance and are subject to certain risks and uncertainties, which could cause actual results to differ materially from historical results or those anticipated. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in the Indonesian retail industry including those factors which may affect our ability to attract and retain suitable tenants, our ability to manage our operations, reduced demand for retail spaces, our ability to successfully complete and integrate potential acquisitions, liability for damages on our property portfolios, the success of the retail malls and retail spaces we currently own, withdrawal of tax incentives, political instability, and legal restrictions on raising capital or acquiring real property in Indonesia. In addition to the foregoing factors, a description of certain other risks and uncertainties which could cause actual results to differ materially can be found in the section captioned "Risk Factors" in our preliminary prospectus lodged with the Monetary Authority of Singapore on 19 October Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that our expectations will be attained. You are cautioned not to place undue reliance on these forward-looking statements, which are based COPY FOR on the ASTRA current INTERNATIONAL view of management on future events. We undertake no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise. 1

3 Portfolio Overview Key Highlights in FY 2017 Financial Highlights Growth Outlook 2

4 A Snapshot 3

5 A Growing Portfolio Portfolio Valuation (Rp billion) CAGR 13.2% 13,769 13,574 17,257 17,764 18,124 19,475 10,667 6,403 7,077 7, Number of Properties

6 Strategically Located Portfolio Retail Malls Retail Spaces 23 Retail Malls 7 Retail Spaces 5

7 Well-diversified Portfolio In Jakarta Outside Jakarta 8 Properties 22 Properties Breakdown by Valuation Breakdown by NLA 43% 41% 57% Rp11,012.3 billion Rp8,463.2 billion 59% 539,581 sqm 371,001 sqm 6 6

8 Land Title Profile HGB/Strata Title BOT Title 20 Properties 10 Properties Breakdown by Valuation Breakdown by NLA 35% Rp6,815.1 billion 65% 45% 408,693 sqm 55% Rp12,660.3 billion 501,889 sqm 7 7

9 Occupancy Rate and Lease Profile High Occupancy Rate 95.0% 94.7% 94.0% 94.3% 93.7% 89.7% Portfolio Average 85.3% 84.7% 85.4% 84.8% Industry Average (Cushman & Wakefield) FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Long Lease Profile 38% 20% 15% 10% 5% >2022 Weighted Average Lease Expiry (by NLA) as at 31 December 2017: 4.13 years Balanced mix of long-term anchor leases and shorter-term leases for nonanchor tenants provide both stability and growth potential Average rental reversion of 5.6% 8

10 Diversified Quality Tenants Trade Sector Breakdown by Gross Revenue* Trade Sector Breakdown by Net Lettable Area All Other Sectors 23% Casual Leasing 15% All Other Sectors 31% Department Store 20% Leisure & Entertainment 4% Department Store 9% Supermarket / Hypermarket 10% Parking 11% F&B / Food Court 15% Fashion 13% Leisure & Entertainment 9% Fashion 10% F&B / Food Court 11% Supermarket / Hypermarket 19% * Exclude other rental income and income from rental of mechanical, electrical and mall operating equipment 9

11 Related-Party Tenants Contribution of Related-Party Tenants to Gross Revenue Non related party tenants 67.0% Master Lease - Retail Spaces 6.3% Master Lease - Kemang 11.1% Master Lease - Kuta 2.4% Matahari 4.5% Hypermart & Foodmart 2.7% Cinemaxx 0.4% Timezone 0.4% Sky Parking 4.3% Other related party tenants 1.0% Income derived from Related Party Tenants contributed approximately 33% of the FY 2017 Gross Revenue Other related party tenants include Nobu Bank, 4G Bolt, Maxx Kitchen, UPH, Maxx Coffee, Big TV & Books & Beyond Master Lease for Retail Spaces expired in Nov 2017; area is currently leased to multiple tenants with occupancy rate at 88.6% 10

12 Portfolio Overview Key Highlights in FY 2017 Financial Highlights Growth Outlook 11

13 Three Acquisitions Lippo Plaza Kendari Purchase Price Rp310.0 billion S$32.2 million Valuation Rp316.0 billion Net Lettable Area 20,146 sqm Occupancy 99.4% Lippo Plaza Jogja Purchase Price Rp570.0 billion S$57.0 million Valuation Rp599.0 billion Net Lettable Area 23,023 sqm Occupancy 98.6% Kediri Town Square Purchase Price Rp345.0 billion S$34.4 million Valuation Rp364.0 billion Net Lettable Area 16,840 sqm Occupancy 99.6% 12

14 Key Operational Highlights Completed enhancement works at Lippo Plaza Ekalokasari Bogor with occupancy improving to 86.9% as at 31 December 2017, compared to 71.3% as at 31 December 2016 Transferred adjoining retail wing extension of Plaza Medan Fair to LMIR Trust, increasing total mall NLA by 16.8% to 64,303 sqm Completed additions and alterations works at Istana Plaza Extended strata titles under Java Supermall Units for another 20 years to 24 September 2037 Extended strata titles under Mall WTC Matahari for another 20 years to 8 April 2038 Entered into new lease agreements for the seven retail spaces 13

15 Portfolio Overview Key Highlights of FY 2017 Financial Highlights Growth Outlook 14

16 Continued Growth in Revenue and NPI Gross Revenue (S$ 000) 26.3% 8.7% 5.0% 136, , , ,376 FY 2014 FY 2015 FY 2016 FY 2017 Net Property Income (S$ 000) 25.8% 8.4% 7.2% 126, , , ,251 FY 2014 FY 2015 FY 2016 FY

17 Steady Growth in Distribution Distributable Income to Unitholders (S$ 000) 25.8% 11.6% 1.6% 68,014 85,553 95,468 96,960 FY 2014 FY 2015 FY 2016 FY 2017 DPU (Singapore Cents) % % 0.9% Based on closing price of S$0.40 as at 29 December 2017, annualised distribution yield was 8.6% FY 2014 FY 2015 FY 2016 FY

18 Healthy Balance Sheet and Gearing Balance Sheet (S$ million) 2, , , , , , , , Perpetuals Equity Debt Gearing % 35.0% 31.5% 33.7% Gearing is well below the regulatory gearing limit of 45%

19 Debt Maturity Profile Fixed Rate Debt Ratio Weighted Average Maturity of Debt Weighted Average Interest Rate Per Annum Interest Cover 47.5% 2.13 years 4.7% 6.0 times 300 As at 31 December COPY 4FOR ASTRA INTERNATIONAL Revolving Credit Term Loans Bonds Notes: 1 S$80 million 1.80% + SOR revolving credit facility 2 S$100 million 4.50% bond due 23 November S$90 million 3.00% + SOR term loan due 15 December S$75 million 4.10% bond due 22 June S$175 million 2.95% + SOR term loan due 25 August S$175 million 3.15% + SOR term loan due 25 August 2021 Perpetual: S$140 million 7.0% Subordinated Perpetual Securities was issued on 27 September 2016 Perpetual: S$120 million 6.6% Subordinated Perpetual Securities was issued on 19 June

20 Portfolio Overview Key Highlights in FY 2017 Financial Highlights Growth Outlook 19

21 Attractive Indonesian Retail Outlook Strong Middle- Income Growth Potential for rents to catch-up to that of other markets in the long term 20

22 Retail Property Market Trends * Demand Footfall remained strong in prime malls Extremely limited supply and low vacancy rates Net absorption low * Occupancy for prime malls only Supply Moratorium on standalone shopping mall development in Jakarta in place since 2011; supply pipeline extremely thin Moratorium does not affect locations outside of Jakarta city, offer expansion opportunities Rents Vacancy rates remained low with strongest demand from F&B and entertainment tenants Average rents across prime retail market in Jakarta remained flat q-o-q, while whole year growth was 3.3% Annual rental growth projected at 5% in prime retail market Source: Jones Lang LaSalle, Jakarta Property Market Review 4Q

23 Retail Market Drivers Retail sector is still growing though at a slower pace Positive Influences Stable GDP Growth (about 5%) Consumer Confidence Index level still high especially based on expectation on future economy Negative Influences Price increase (CPI) nearly 4% every year Lower real income growth (minimum wage 8% increase, lower compared to previous years) Other Influencing Factors Consumers are more selective on spending due to price pressure and slowing economy (among upper consumer) While purchasing power is increasing, consumption is slowing down as households are more cautious and are saving a greater portion of their income 22

24 Committed Sponsor Sponsor, PT Lippo Karawaci Tbk, Indonesia s largest listed company by total assets and revenue, with a market capitalisation of US$829.8 million 1 as at 31 December 2017 Owns and/or manages 47 malls throughout Indonesia and has another 38 malls in the pipeline Focused on developing and managing community malls located in cities with dense population Malls have an average occupancy rate of over 88% and cater to more than 300 million visitors per year LMIRT has the right-of-first-refusal to acquire Sponsor s properties 1 Based on Bloomberg s data: Rp trillion and exchange rate of US$1 = Rp13,